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Discussion Starter · #1 ·
I was hoping that the groceries would go on sale today along with the rest, but they did not. It even looks like I missed last week's sale on L.TO. Nevertheless, I am considering a position on a grocery and don't know if I want L, EMP-A or MRU, some combination or none of the above. Which would you recommend and why?
 

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I was in MRU, and L. Analyst a year ago called for 12 mo price to be down in L, so I sold, planning to get back in down the road. Held MRU.

Have owned EMP-A for a while and NWC in the past as well, but their times come and go.

Big two plod along nicely.
 

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I've considered adding a grocer to my dividend mix but haven't done much research at all.
Without looking at valuation, I would suspect in these inflationary times, consumers would gravitate towards cheaper lower frills stores and larger grocers would have the scale to provide pricing advantages. To me, that points to L but again, I haven't done much analysis.
 

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I hold EMP, MRU and L.

I see no reason to get rid of any of them. MRU is my favourite, though.
 

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I hold only NWC. I prefer their size and numbers.
 

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Their still a little pricey currently, I purchased Loblaws at $67.26 on 28 Feb 2020, will continue to hold as its likely never to go back to that price and pays dividend so something fairly safe in my portfolio.
 

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I was hoping that the groceries would go on sale today along with the rest, but they did not ...
What I recall is that they go up in these types of situations (i.e. flight to safety times).
I have done better to be buying when the economy is humming and the sentiment is "why waste time with grocers?"


Cheers
 

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Their still a little pricey currently, I purchased Loblaws at $67.26 on 28 Feb 2020, will continue to hold as its likely never to go back to that price and pays dividend so something fairly safe in my portfolio.
I thought Loblaw's was pricey at $80-90 and opted for Saputo and Choice Properties as alternatives. Loblaw's has still done better in that short time frame of 6-9 months. I doubt it will go back to $80 anytime soon. I know a lot of people that have made a habit of preparing their own meals during the pandemic and realized the savings in doing so. Not sure when we will see a big enough resurgence in restaurant dining but that might provide an entry point into this space.
 

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I remember that being a concern for me as well during the renegotiation of NAFTA. Many feel that with Trump gone that free trade will resume. I am more doubtful as buy American is still engrained in the US. Saputo does have a presence outside of Canada. They are feeling inflation pressure on input costs but I think they will be able to navigate their way through. I have an order in this week around $25 to top up my holding to a full position.
 

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Not sure if this is better suited for the politics thread but it did have some numbers for the names mentioned upthread on their recent performance.

Jagmeet Singh says grocery chains are ‘profiteering’ amid inflation. Is it true? (msn.com)
"NDP Leader Jagmeet Singh is calling out Canada's major grocery chains for making record profits".

Oh no, a business is making a profit. We simply can't have that in socialist Canada. Let's add an extra special tax to that business and re-distribute that wealth.

ltr
 

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Discussion Starter · #13 ·
At the minute the three I am interested in are down a little -- though not on sale. PE on L and MRU are both about 20 which feels a little too high. EMP-A is at 15 which feels reasonable. EMP-A is the smallest by market cap of the Canadian majors. Any concerns about the non-voting status of the public shares?
 

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Discussion Starter · #14 ·
So I finally pulled the trigger and started a small position on L today. The PE is still 19. I am also concerned by the multi-level ownership scheme that gives the Westons complete control. Family shenanigans have undermined the value of more than one of my holdings in the past. We'll see if I add to L in the future or diversify into MRU or EMP.A.
 

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Small write-up in the G&M's upgrades and downgrades piece on the grocers referencing Desjardins' material today. Behind paywall.
Thinks the large grocers will continue to outperform with price increases outpacing decreases. Also thinks the cheaper private labels of L and MRU compared to name brand products helps support their premium valuations. But they slightly prefer EMP due to the better valuation.
EMP down 6%
that valuation just got better from a buyer's perspective. ;)
I haven't read the report but aside from supply chain, labour costs blah blah blah was there any earth shattering in the release?
 

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I didn't read it.
They have learned from their mistakes and they are doing much better in the west. Their brands are starting to be more respected.

I also started my position in the low 20's so I'm just holding. I'm not adding here, but if it were to drop lower then I might add more in the future.

I still prefer MRU over L and EMP.
 
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